Gough Gough & Hamer Limited v New Zealand Forestry Corporation Limited [2013] NZHC 19 (25 January 2013)

Last Updated: 30 January 2013

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2012-404-005838 [2013] NZHC 19

IN THE MATTER OF the Companies Act 1993

BETWEEN GOUGH GOUGH & HAMER LIMITED Plaintiff

AND NEW ZEALAND FORESTRY CORPORATION LIMITED Defendant

Hearing: 25 January 2013

Appearances: B Pamatatau for plaintiff

G A Palmer, representative of defendant (by leave) Judgment: 25 January 2013

_{(ORAL) JUDGMENT OF ASSOCIATE JUDGE ABBOTT}

Solicitors:

K P McDonald, Kevin McDonald & Associates, PO Box 331 065, Auckland

Counsel:

B Pamatatau, PO Box 2422, Auckland

Copy to:

G A Palmer – email: [e-mail]

GOUGH GOUGH & HAMER LIMITED V NEW ZEALAND FORESTRY CORPORATION LIMITED HC AK CIV 2012-404-005838 [25 January 2013]

[1] This is the third call of this application. It has been adjourned on two prior occasions to allow the defendant opportunity to address procedural deficiencies, and to provide some evidence in support of its contention both that at least part of the debt has been paid, and that there is a valid dispute over another part (charges comprising interest and costs claimed under the terms of trade between the parties).

[2] On the last call I made it clear to Mr Palmer (who I allowed to address the Court, notwithstanding that he is not legally qualified and is not a director of the company) that notwithstanding the deficiencies in its documents I would allow the company time to make the payment. I ruled that I did not accept that there was a valid statement of defence on file, and that there was insufficient evidence to lead me to believe there was any basis to overlook the procedural deficiencies and have this matter proceed to a defended hearing.

[3] Mr Palmer has appeared again today for the company. He says that the company has endeavoured to obtain legal representation but has been unable to do so. I don’t accept that. There has been ample time to do that.

[4] Mr Palmer accepts that there has been no payment made. He still contends that there is a dispute which ought to be referred to the District Court or to the Disputes Tribunal. He seeks an adjournment for that purpose.

[5] The debt that underlies this application comprises invoices dated 31

December 2011 and 31 January 2012. The total of those invoices is $2,526.21. As I

understand the defendant’s contention, it says that a payment of $736 made on 7

June 2012 should be credited against that sum. On the evidence produced by the defendant, it is clear that that payment was in fact simply replacing a dishonoured payment made on 29 November 2011 in respect of prior indebtedness. In my view it does not impeach the total invoiced debt of $2,526.21.

[6] I am unable here to resolve the alleged dispute over the terms of trade. That may need to be a matter for determination elsewhere. However, I am satisfied that there is a clear debt due and unpaid of $2,526.21.

[7] Turning to whether or not this matter should go to any further hearing, I am of the clear view that it should not. The defendant did not challenge the statutory demand (in other words, apply to set it aside). It simply came before the Court with the procedurally deficient statement of defence that I rejected at the last call. There is thus a presumption of insolvency operating against the defendant. Counsel for the plaintiff has produced a certificate that the amount of $3,717.71 is outstanding as of today. This clearly includes the core debt of $2,526.21. It is a sufficient basis for me to find that there is an outstanding debt and a basis for a finding of insolvency. In that respect I take into account that at the call on 12 December 2012 I gave the company until today to pay the outstanding amount. Had it paid this core debt, I might have considered dismissing the application for liquidation and leaving the dispute over the terms of trade for another day. Given that there has been no effort to make that payment (or at least that payment has not been made), I see no need to delay matters any further. It will be for the plaintiff to make its case to the liquidator for the sum claimed pursuant to the terms of trade.

[8] Counsel for the plaintiff has produced a consent to act signed by the proposed liquidators on 6 November 2012 (it had been on filed previously but was unsigned by the solicitor). Counsel advises that he has confirmed the validity of that consent and signed it on behalf of the plaintiff today.

[9] I make an order putting the defendant company into liquidation.

[10] Peri Micaela Finnigan and Tony Leonard Maginness are appointed liquidators.

[11] The defendant is to pay costs to the plaintiff, on a scale 1A basis, together with disbursements as fixed by the Registrar.

[12] The rates of remuneration of the liquidators and staff working under their supervision and control are fixed at the rates set out in the liquidators consent dated 6

November 2012.

[13] The liquidators are to apply at conclusion of the liquidation for approval of their overall remuneration.

_{[14] These orders are made at 12.45pm.}

Associate Judge Abbott